00:00:02
imagine Europe a continent United in
00:00:04
policy but divided in ambition now Spain
00:00:08
a key player in this intricate puzzle
00:00:10
has just made a bold move but what does
00:00:13
it mean and why is everyone in Europe
00:00:15
suddenly So
00:00:17
Silent Spain has shifted its stance on
00:00:20
China in a way that's left Europe
00:00:22
utterly speechless no one saw this
00:00:25
coming and if you think this is just
00:00:27
about cars think again it's about
00:00:30
without power influence and the future
00:00:32
of Europe's entire relationship with
00:00:36
China Spain's abrupt decision to break
00:00:39
away from the European Union's plan to
00:00:41
impose heavy tariffs up to 38% on
00:00:45
Chinese electric vehicles has left the
00:00:47
entire continent in a State of Shock
00:00:49
just a few weeks ago this move seemed
00:00:51
like a no-brainer European automakers
00:00:54
have been struggling to keep up with
00:00:56
China's rapidly growing EV industry with
00:00:59
Chinese companies like byd and Neo
00:01:01
flooding the market with cheaper
00:01:03
highquality alternatives the tariffs
00:01:05
were designed to protect European car
00:01:08
manufacturers but Spain pulled the plug
00:01:12
so why
00:01:15
now some believe Spain's change of heart
00:01:18
stems from its dependence on Chinese
00:01:20
trade according to the latest figures
00:01:22
Spain's trade with China surged by 15%
00:01:26
in the last year alone a full 7% of
00:01:28
Spain's total export ports are bound for
00:01:30
China including high value Goods like
00:01:32
Machinery electronics and agricultural
00:01:35
products with numbers like that it's no
00:01:37
wonder Spain is rethinking its stance
00:01:40
prime minister Pedro Sanchez is playing
00:01:42
a long game here one that involves
00:01:44
navigating the fine line between EU
00:01:46
solidarity and the harsh realities of
00:01:49
economic dependence on
00:01:52
Beijing the meeting between Pedro
00:01:55
Sanchez and Xi Jinping earlier this year
00:01:58
was more than just a diplomatic
00:02:00
handshake behind closed doors trade and
00:02:02
economic agreements were the real
00:02:04
subjects of discussion the result a
00:02:07
significant pivot in Spain's foreign
00:02:09
policy one that emphasizes maintaining
00:02:12
and even expanding its trade ties with
00:02:14
China Bloomberg recently reported that
00:02:17
after the Sanchez shei meeting Spanish
00:02:20
exports to China saw a 12% spike in the
00:02:23
first quarter of 2024 alone this Spike
00:02:28
included everything from agriculture Cal
00:02:30
Goods to Industrial Machinery but here's
00:02:33
where it gets interesting Spain's
00:02:35
automotive industry which directly
00:02:37
competes with China's growing EV sector
00:02:40
has yet to feel the full brunt of this
00:02:42
competition by blocking the eu's
00:02:44
proposed tariffs Spain is essentially
00:02:47
buying time allowing its automakers to
00:02:50
adjust to the new reality political
00:02:52
analysts argue that Spain's pivot is a
00:02:54
signal that the country sees China as an
00:02:57
Irreplaceable trading partner the South
00:03:00
China Morning Post ran an article
00:03:02
headlined Spain's economic diplomacy how
00:03:05
Beijing became the power behind Madrid's
00:03:08
bold moves it suggests that Spain's
00:03:11
economy has become increasingly
00:03:12
intertwined with China's from technology
00:03:15
Investments to agricultural Imports with
00:03:18
this growing dependence a confrontation
00:03:20
with China over EV tariffs could have
00:03:22
catastrophic consequences for Spain's
00:03:25
broader economy if you are enjoying our
00:03:27
content please hit the like button to
00:03:30
help us even more please share and leave
00:03:32
your thoughts and feedback in the
00:03:34
comments your engagement helps us grow
00:03:37
thank
00:03:39
you Europe's car industry is fighting
00:03:42
for survival over the last decade the
00:03:44
European Union watched as its once
00:03:46
dominant car manufacturers from
00:03:49
Volkswagen to PUO began to lose market
00:03:51
share to cheaper and sometimes Superior
00:03:54
electric vehicles from China in 2023
00:03:57
Europe's car exports fell by 9% while
00:04:00
Imports of Chinese EV soared by
00:04:02
18% according to data from statista
00:04:05
Chinese EV sales in Europe grew to over
00:04:07
1.2 million units last year up from just
00:04:11
800,000 the year before and it's not
00:04:13
just quantity Chinese EVS are winning on
00:04:16
quality too Automotive news Europe
00:04:19
recently published an article showing
00:04:21
how Chinese brands have received better
00:04:23
customer satisfaction ratings in key
00:04:26
European markets than many European
00:04:28
competitors the eu's proposed tariffs
00:04:31
were designed to protect European
00:04:33
automakers from this Onslaught leveling
00:04:36
the playing field by raising the price
00:04:38
of Chinese
00:04:39
Imports Europe can't afford to lose its
00:04:43
manufacturing base if we let China
00:04:46
dominate our car markets we'll be
00:04:49
Outsourcing jobs and technological
00:04:51
innovation at an alarming rate said Marg
00:04:54
vtiger the European commissioner for
00:04:56
competition in a recent interview with
00:04:59
Lamont
00:05:00
but with Spain refusing to back the
00:05:02
tariffs the eu's strategy could unravel
00:05:04
leaving European automakers exposed to
00:05:07
even fiercer
00:05:10
competition Spain's decision to reject
00:05:12
the eu's tariff plan is not without risk
00:05:16
in fact it could backfire in a big way
00:05:18
especially in two key sectors farming
00:05:21
and Automotive manufacturing Spain's
00:05:24
agricultural sector is deeply tied to
00:05:26
the Chinese market over 40% of Spain
00:05:29
pork exports go to China a trade
00:05:33
relationship worth over € 1.5 billion e
00:05:37
annually according to data from the
00:05:39
Spanish Ministry of Agriculture should a
00:05:42
trade War erupt China could easily
00:05:45
impose retaliatory tariffs on Spanish
00:05:48
agricultural products devastating an
00:05:51
industry that employs over
00:05:54
300,000 people then there's the
00:05:56
automotive sector Spain is the second
00:05:59
largest car manufacturer in Europe right
00:06:02
behind Germany but unlike Germany Spain
00:06:07
doesn't have a well-established luxury
00:06:09
car segment instead it focuses on
00:06:13
mid-market models that are highly
00:06:14
susceptible to competition from cheaper
00:06:17
Chinese Alternatives a trade conflict
00:06:20
with China could result in steep price
00:06:22
hikes for components which would make
00:06:25
Spanish cars more expensive to produce
00:06:27
and less competitive on the global state
00:06:29
AG Reuters highlighted this growing
00:06:32
concern in a recent article titled Spain
00:06:34
risks economic Fallout as trade war with
00:06:40
China looms the piece emphasized that
00:06:43
even a slight increase in manufacturing
00:06:46
costs could lead to a massive loss of
00:06:48
jobs and
00:06:51
revenue Spain's pork industry is one of
00:06:53
the largest in Europe and China is its
00:06:56
most lucrative Market over the past
00:06:58
decade SP Spanish pork exports to China
00:07:01
have grown exponentially making up a
00:07:03
whopping 43% of Spain's total pork
00:07:06
export Market according to eurostat this
00:07:09
isn't just about money it's about jobs
00:07:12
too the pork industry employs tens of
00:07:15
thousands of workers and Rural
00:07:17
communities across Spain depend on this
00:07:19
trade to survive if China retaliates
00:07:22
against Spain's refusal to impose
00:07:24
tariffs on Chinese EVS by targeting
00:07:28
agricultural Goods it could devastate
00:07:30
these rural economies Spain has put
00:07:33
itself in a precarious position one
00:07:36
wrong move and China could easily cut
00:07:39
its Imports of Spanish pork leaving
00:07:41
farmers in the Lurch warned Professor
00:07:43
Juan Moreno an agricultural Economist at
00:07:46
the University of Seville in an
00:07:48
interview with elmundo and it's not just
00:07:51
pork Spain's exports of olive oil wine
00:07:54
and other agricultural Goods could also
00:07:57
take a hit if China decides to Flex its
00:08:00
economic
00:08:02
muscles China is not known for backing
00:08:05
down when faced with economic pressure
00:08:08
if the EU imposes tariffs on Chinese EVS
00:08:11
Beijing will likely respond in kind
00:08:13
targeting key European Industries the
00:08:16
question is which sectors will suffer
00:08:18
the most the answer is simple luxury
00:08:22
goods and Technology Europe's high-end
00:08:24
brands from lvmh to Herms depend on
00:08:28
China's wealthy consumer s in 2023
00:08:31
Chinese Shoppers accounted for nearly
00:08:33
30% of global luxury spending according
00:08:36
to banan company a Chinese backlash
00:08:39
could these companies forcing
00:08:42
them to rethink their entire business
00:08:45
models on the tech front Europe exports
00:08:48
billions of Euros worth of equipment to
00:08:50
China every year China is the eu's
00:08:55
second largest trading partner and any
00:08:57
disruption to this relationship would
00:08:59
have dire
00:09:01
consequences China has the power to shut
00:09:03
down entire Industries if they feel
00:09:05
threatened the eu's tariffs on EVS could
00:09:09
spark a trade war that Europe is ill
00:09:11
prepared to handle said Elizabeth bra a
00:09:14
senior fellow at the American Enterprise
00:09:16
Institute in a recent oped for the Wall
00:09:18
Street
00:09:20
Journal Germany's opposition to the
00:09:23
tariffs on Chinese EVS is rooted in its
00:09:25
automotive industry Germany is home to
00:09:28
giants like Volkswagen BMW and
00:09:31
mercedesbenz all of which have
00:09:33
significant investments in China in fact
00:09:36
Volkswagen sold over 35 million vehicles
00:09:39
in China last year accounting for nearly
00:09:42
40% of its Global sales losing access to
00:09:46
the Chinese market would be catastrophic
00:09:48
for Germany's economy in contrast
00:09:51
countries like France and Italy are less
00:09:53
reliant on China for automotive exports
00:09:57
and more focused on protecting their
00:09:59
demand domestic markets French president
00:10:01
Emanuel macron has been particularly
00:10:04
vocal about the need for tariffs arguing
00:10:07
that Europe must protect its workers
00:10:09
from unfair
00:10:10
competition Europe must defend
00:10:15
itself we cannot allow our Industries to
00:10:18
be destroyed by Chinese subsidies macron
00:10:21
said in a speech last month covered by
00:10:24
lefigaro The Divide between these
00:10:26
countries highlights a growing Rift
00:10:28
within the the EU Germany with its
00:10:31
strong economic ties to China is
00:10:34
reluctant to escalate tensions while
00:10:37
France and Italy who have been hit
00:10:39
hardest by Chinese competition are
00:10:41
pushing for stronger
00:10:45
protections Spain's decision to go
00:10:47
against the eu's Tariff proposal reveals
00:10:50
the growing fault lines within the
00:10:52
European Union as each country grapples
00:10:55
with its own economic challenges a
00:10:57
unified stance on China is is becoming
00:11:00
increasingly difficult to maintain while
00:11:02
some Nations like Germany and Spain are
00:11:05
prioritizing economic ties with China
00:11:08
others like France and Italy are calling
00:11:11
for stronger protections against what
00:11:13
they see as unfair competition this
00:11:17
division is more than just a trade issue
00:11:20
it's a political one Europe is at a
00:11:22
Crossroads with some countries pushing
00:11:24
for deeper integration and others
00:11:26
advocating for a more flexible Nation
00:11:28
first approach The Economist recently
00:11:31
ran a headline the great European
00:11:35
divide how China is driving a wedge
00:11:39
between EU members it's a dilemma that
00:11:42
will shape the future of the European
00:11:44
Union and its relationship with China
00:11:46
for years to
00:11:49
come let's get into the numbers because
00:11:51
the heart of this story is wrapped in
00:11:54
trade in 2023 alone China's Trade
00:11:57
Surplus with the European Union reached
00:12:00
an eye-watering 400 billion EUR a figure
00:12:03
that's impossible to ignore what's
00:12:06
driving this imbalance it's simple China
00:12:09
exports more to Europe than it Imports
00:12:12
while Europe buys Goods like Electronics
00:12:14
machinery and now electric vehicles the
00:12:17
Chinese market isn't returning the favor
00:12:20
in the same proportion this Surplus is
00:12:23
becoming a massive headache for European
00:12:25
leaders and it's not just about the
00:12:27
numbers it's about the leverage this
00:12:30
gives China in
00:12:31
negotiations the more dependent Europe
00:12:34
becomes on Chinese Imports the more
00:12:36
power China holds over European
00:12:39
economies think about it if Europe
00:12:42
continues to rely on cheap Chinese Goods
00:12:44
what happens when China decides to
00:12:46
tighten the screws it's a balancing act
00:12:50
one where Europe is constantly on the
00:12:52
defensive now Spain's decision to step
00:12:55
back from the eu's proposed tariffs on
00:12:58
Chinese electric Vehicles shines a
00:13:00
spotlight on this issue Spain the fourth
00:13:04
largest economy in the Euro Zone sees
00:13:06
China as too important a partner to risk
00:13:09
alienating the reality is clear Spain
00:13:12
needs Chinese investment and the Surplus
00:13:15
doesn't scare them as much as it does
00:13:16
France or Italy economists like Paul
00:13:19
Donovan from UBS have been sounding the
00:13:21
alarm saying China has far more leverage
00:13:24
in its relationship with Europe than
00:13:26
many people are willing to admit if
00:13:29
Europe doesn't take action now China's
00:13:32
economic footprint will continue to grow
00:13:34
at a rate that some fear could put
00:13:36
Europe in a choke
00:13:39
hold this story isn't just about Europe
00:13:42
and China what happens in this corner of
00:13:44
the world will have Ripple effects
00:13:46
across the global economy when two
00:13:48
economic giants Clash The Fallout isn't
00:13:51
contained it spreads right now the trade
00:13:54
tensions between the EU and China are
00:13:57
sending shock waves through Global
00:13:59
markets from raw materials in Africa to
00:14:03
Tech Manufacturing in Southeast Asia the
00:14:06
chess board is Shifting geopolitically
00:14:09
this escalating tension between Europe
00:14:11
and China is also drawing in other
00:14:14
Global players especially the US with
00:14:18
President Biden's Administration pushing
00:14:20
for stronger alliances in its own trade
00:14:23
war with China a fragmented European
00:14:26
Union could weaken the Western Block's
00:14:28
position
00:14:29
against
00:14:31
Beijing now listen to this while some
00:14:34
European countries like Spain are opting
00:14:36
for dialogue the US is taking a more
00:14:39
confrontational approach that Divergence
00:14:42
could split the Western World strategy
00:14:44
towards China the New York Times
00:14:47
recently reported as Europe and China
00:14:49
lockhorns the global supply chain is
00:14:51
preparing for massive disruptions any
00:14:54
escalation could be catastrophic and
00:14:57
it's not just about trade China is
00:14:59
expanding its belt and Road initiative
00:15:01
bringing countries across Africa South
00:15:04
America and Southeast Asia into its
00:15:06
orbit if Europe isolates itself China
00:15:09
might find even more willing Partners to
00:15:11
fill that economic void the global
00:15:14
economy is Shifting quickly and Spain's
00:15:18
decision could change Europe's place in
00:15:20
that order with every diplomatic move
00:15:23
the balance of power shifts a little
00:15:25
more toward the
00:15:27
east so what does Spain want here is
00:15:31
this a purely economic calculation or is
00:15:34
there more at play well let's not forget
00:15:38
Spain is positioning itself as a bridge
00:15:40
between Europe and the rest of the world
00:15:42
and by refusing to back the eu's tariffs
00:15:44
on Chinese electric vehicles it's clear
00:15:47
that Spain sees itself playing a key
00:15:49
role in navigating these Troubled Waters
00:15:53
here's why Spain has significant
00:15:55
economic interest in maintaining a solid
00:15:57
relationship with China China is now
00:16:00
Spain's third largest trading partner
00:16:03
and as of 2023 Spanish exports to China
00:16:07
grew by over 15% with Machinery
00:16:11
Agriculture and pharmaceuticals leading
00:16:13
the charge but it's not just about trade
00:16:16
it's about investment in the past year
00:16:20
Chinese companies have invested heavily
00:16:23
in Spain particularly in technology
00:16:27
infrastructure and renewable energy
00:16:29
sectors in fact the financial times
00:16:32
reported that Chinese direct investment
00:16:34
in Spain exceeded 5 billion EUR in 2023
00:16:39
alone that's massive and Spain knows
00:16:43
that this capital is vital for its
00:16:44
long-term Economic Development Sanchez's
00:16:48
government has also been vocal about its
00:16:50
desire to mediate between the EU and
00:16:52
China by taking a softer approach Spain
00:16:55
hopes to become a key player in shaping
00:16:57
the eu's future Poli policies it's a
00:17:00
strategic move one that positions Spain
00:17:02
not as a follower of European directives
00:17:05
but as a leader advocating for pragmatic
00:17:08
dialogue driven Solutions Spain doesn't
00:17:11
want to Simply follow in the footsteps
00:17:13
of France or Germany it wants to carve
00:17:16
out its own role balancing the European
00:17:18
need for competition with the economic
00:17:21
necessity of strong ties with China it's
00:17:25
a difficult role to play but one that
00:17:28
could Define Spain's position within the
00:17:30
European Union for years to come how
00:17:33
could Spain's decision to push for
00:17:35
dialogue instead of conflict position
00:17:37
the country as a key player in shaping
00:17:40
future EU China
00:17:43
relations Spain's refusal to back the
00:17:45
proposed tariffs on Chinese electric
00:17:48
vehicles isn't just making headlines
00:17:50
it's setting the stage For an upcoming
00:17:52
vote that could determine Europe's
00:17:54
entire trade future the EU is preparing
00:17:56
to vote on these tariffs and Spain sh
00:17:58
shift may have thrown a wrench into what
00:18:00
was supposed to be a straightforward
00:18:02
decision the EU needs a strong consensus
00:18:05
to push through significant trade
00:18:07
measures like these tariffs but now with
00:18:10
Spain backing out the fault lines within
00:18:12
the union are
00:18:13
exposed Germany already hesitant about
00:18:17
the tariffs could follow Spain's lead
00:18:20
and if the vote falls apart it will send
00:18:22
a message to Beijing that Europe isn't
00:18:25
as United as it claims to be when it
00:18:27
comes to China according to Politico
00:18:30
Europe Spain's decision has thrown the
00:18:32
eu's carefully laid plans into chaos
00:18:36
with key leaders scrambling to find a
00:18:38
way to salvage the upcoming vote and
00:18:41
that vote is critical if the EU fails to
00:18:44
impose tariffs it could weaken Europe's
00:18:46
negotiating position with China if the
00:18:49
tariffs go through Spain and other
00:18:52
dissenting Nations will have to face the
00:18:54
consequences of potential economic
00:18:56
retaliation from Beijing
00:19:00
so what does this all mean Spain's move
00:19:03
isn't just another headline it's a
00:19:06
seismic shift in the balance of power
00:19:08
between Europe and China as trade
00:19:11
tensions heat up Spain has taken a
00:19:13
calculated gamble one that could reshape
00:19:16
its economy and Europe's future will
00:19:18
Spain's decision spark new alliances or
00:19:20
deepen the cracks in the European Union
00:19:23
only time will tell but one thing's for
00:19:25
sure the world is watching we hope you
00:19:28
are enjoying enjoying this video we're
00:19:30
thrilled to have you with us today if
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00:19:35
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